MUMBAI: State Bank of India’s joint venture partners in life and general insurance business have asked the country’s largest bank to increase their stake following changes in Indian laws that enabled foreign partners to increase stake up to 49%. This will be the first such increase in stake by foreign partners.
In the life insurance space, SBI has BNP Paribas Cardiff as a partner. BNP Paribas, which owns 26% in the life insurance venture, has asked SBI to increase it to 36%. BNP Paribas Cardiff has a right to increase its shareholding up to 49%. “Both the sides will be doing their own independent valuation of the stakes,’’ said Arundhati Bhattacharya, chairman of SBI.
“In case of a variance in the value by more than 10%, it will be referred for valuation to a third party.’’
Likewise, in general insurance too SBI’s partner Insurance Australia Group (IAG) stated its intention to increase its stake to 49%. IAG sent a letter to the State Bank of India sharing its intention. After the changes in stake-holdings SBI will continue to own majority shareholding in the respective insurance companies.